Greenwich company to acquire Georgia shipping logistics provider

Richard Lee

Published 7:32 pm, Monday, July 22, 2013

A Greenwich-based freight management services provider is growing fast, and it has taken another step on the ladder toward becoming a billion-dollar business with the planned purchase of a Georgia company.

XPO Logistics has agreed to acquire 3PD, an Atlanta-based shipping logistics company that focuses on scheduling "last mile" delivery of heavy goods from terminals. The transaction, valued at $357 million in cash and $8 million in XPO restricted stock, is expected to close in the third quarter.

Founded by Karl and Randy Meyer in 2001 to capitalize on rapid growth in the last-mile logistics segment serving retail shippers, 3PD facilitates about two times more annual deliveries than its nearest competitor, according to XPO officials. The business reported year-over-year growth of 20 percent and 36 percent for the full year 2012 and the first five months of 2013, respectively. Through May 31, its revenue for the past 12 months is $319 million.

All of 3PD's executives have agreed to join XPO and will continue to lead the operation.

Led by Bradley Jacobs, chairman and CEO, XPO Logistics has said it plans to grow through the purchase of non-asset based logistics businesses.

4.5 million deliveries a year

In 2012, it acquired Turbo Logistics, Kelron Logistics, Continental Flight Services and BirdDog Logistics. They have been followed by the purchase of East Coast Air Charter, Covered Logistics, Interide Logistics and 3PD in 2013.

XPO Logistics looked at more than 1,000 companies in the last 18 months and has whittled them down to a short list of 100, he said.

"We move a lot of freight from factories and retailers to distribution centers and stores. 3PD handles the part of the supply chain that's known as the `last mile.' They facilitate the shipments from the distribution point to the end customer -- it could be a home, business or job site," Jacobs said. "They facilitate over 4.5 million deliveries a year."

3PD, which has 28 locations, serves a logistics market with a high growth rate driven by the rapid growth of Internet purchases and the retailer shift toward outsourcing delivery of heavy goods, he said, adding that 650 3PD employees will come over to XPO Logistics, increasing the company's total employment roll to about 1,750 at 90 locations.

`Transformative Deal'

Traded on the New York Stock Exchange under the ticker symbol "XPO," the company had a first quarter net loss of $15.3 million, or 85 cents per share, compared with a loss of $3.4 million, or 36 cents a share for the same period in 2012. But revenue in the most recent quarter was $114 million -- a 155.8 percent increase from the same period a year ago.